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Business, 23.04.2020 16:34 darlaaa

An investment of $85,000 is made for a 3D-printing machine. It is expected to generate an annual revenue of $48,000 with annual expenses of $17,000. The project life is 8 years and the equipment has a class life of 5 years and MACRS-GDS depreciation is used. The 3D-printing machine will have a salvage value estimated at $5,000 when the project is complete (treat it as a revenue in the 9th year). The equipment has a class life of 5 years, MACRS-GDS depreciation will be used, and the income taxes are 35%. The required return (discount rate) is 10%. A loan for $30,000 is needed for 3 years and the interest rate is 15%. First construct a table similar to table 12.1 or 12.2 and then (use excel so that you can reuse the format for your project part 2):

a. Determine the Payback Period in years.
b. Determine the Discounted Payback Period in years.
d. Determine the Future Worth of the net profits.
e. Determine the Average Annual Worth of the net profits.

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